Edwardsville expects revenue increase in 2016

City manager cautions that debt payments also will rise

The Edwardsville City Council got a bit of positive news as they began reviewing 2016 budget numbers Monday.

“I would say tonight’s the good news night because we’re talking about revenues,” said Michael Webb, city manager.

Webb told the council that city’s overall appraised property values were expected to increase about 7 percent next year, higher than the other two cities in the county by at least 2 percent. However, Webb cautioned the council that while the valuation increase would mean a slight property tax revenue increase, things would get more difficult as they continued to discuss the budget, and necessary expenditures, later this month.

Webb said conservative budgeting this year had proven beneficial.

“The good news overall is we probably underestimated 2015 a little bit, and we’ve seen growth in 2015 going into 2016 that we had not envisioned,” he said.

Sales taxes are estimated at $1,291,731 in 2016, a nearly 3 percent increase over the $1,254,108 collected in 2014 and well above the $1,205,157 conservatively estimated for 2015’s budget.

The city’s portion of gaming revenues from the Hollywood Casino was conservatively estimated at $377,963 for 2015. In 2014, actual casino revenues for the city were $401,594, so Webb said they were estimating $409,000 in 2016.

Appraised values are expected to reach $50,845,041, a 7.67 percent increase over 2015 and almost returning to 2009’s pre-recession levels of $50,937,752.

Webb said almost all of that increase came from the Fastenal building in the industrial park coming off of its tax abatement and on to the tax roll. He noted that in 2017, three more tax-abated properties would come back on to the tax roll.

So, if the city maintains its current property tax rate, property tax revenues would increase $147,529 to $2,384,293. Of that total, $552,343 would be used for debt payment services.

Payments in lieu of taxes for properties that have abatements also are expected to increase by $44,102, or 16 percent, to $318,370, and $73,753 of that will be used for debt services.

But Webb said with the issuance of industrial revenue bonds this year, debt payments were expected to increase in 2016 as well.

Webb said considering both revenue increases and expenditure needs for next year, he didn’t see any need for a property tax rate increase. But he said he also had concerns about the state legislature’s “tax lid” legislation, a move to limit cities to property tax rate increases only by public vote.

“I think what you’ll hear from us is to maintain the levy where it is, but with tax lid, we’d have to be careful going up or down,” he said.

He said city staff had already made note of the following requests for 2016 funding that won’t fit in their 2016 departmental budgets:

Staffing: a customer service clerk, a police officer, moving a part-time maintenance worker position to full time, and a part-time assistant parks coordinator.

Capital items: a brush truck, a public works truck for plowing, two replacement police vehicles, a power cot for EMS, extrication tools for the fire department, mill and overlay funding, and covered parking for police vehicles in inclement weather.